Union outraged about boutique funding

The funding of a luxury Johannesburg boutique with taxpayers’ money was a national disgrace, the SA Clothing and Textile Workers’ Union (Sactwu) said on Wednesday.

“[T]his is completely inappropriate in a country where the main challenges are to tackle our triple crises of poverty, inequality, and unemployment,” Sactwu general secretary Andre Kriel said.

The union was responding to news that Trade and Industry Minister Rob Davies had called for a report into the National Empowerment Fund’s (NEF) approval of financing of R34.1 million to establish the Luminance boutique, which sells luxury clothing and related goods, in Hyde Park, Johannesburg. The boutique is run by model and media personality Khanyi Dhlomo, her mother Venetia, and businesswoman Judy Dlamini.

“We are particularly disturbed that the NEF appears to have funded a business which undermines local procurement of clothing, textiles and leather goods and hence promotes local job losses,” Kriel said. Sactwu wanted a probe into the matter.

“We need the NEF to help the poor, to promote local industry and to help fight unemployment in a meaningful manner, not to promote the interests of the rich.”

The Democratic Alliance and SA Chamber of Commerce and Industry (Sacci), also called for an investigation.

In a statement on Tuesday night, Davies said he had asked the NEF to provide him with a report on the matter. He declined to comment about the deal before receiving the report.

“Among the other things I want to hear… is whether the transaction has or has not been within the framework that we have been articulated for, on empowerment. It must support productive sector entrepreneurship and support local productive activity in our country,” he said.

The report would determine whether there was a need to change the NEF’s mandate of transactions.

On Wednesday, the DA said it would write to Davies asking that the report be tabled in Parliament.

“Providing financing to wealthy individuals for luxury boutiques that cater for the super-rich is anything but broad-based and essentially amounts to ’empowering the empowered’,” DA MP Wilmot James said.

Sacci said it was critical to ensure the funding was in line with the NEF’s mandate.

“The fact that the funds are public necessitates transparency and accountability. The action by minister Rob Davies is a welcome continuation of a push towards greater transparency and accountability,” the chamber said.

NEF CEO Philiswe Mthethwa was quoted at the weekend as saying the shop was a legitimate investment.

“This is the first major investment in a business owned by black women. They seek to transform a sector dominated by whites and foreign interests,” Mthethwa said.